Yeah, I'm completely jumping on the blogoshpere bandwagon by posting a link to Clifford Stoll's 1995 Newsweek article on why the internet was going to be a passing fade.
However, it's not schadenfreude I'm interested in so much as why do we humans consistently underestimate the scope of important changes? Particularly with regards to trans formative technologies. Supposedly Thomas Edison predicted the telephone would fin only a limited use, with just a handful in each city.
And it's more than just that. When it comes to dealing with abstracts like risk management, investing strategies, or finance in general, human beings are consistently irrational. Often to a degree that can be quantified.
My personal opinion?
Our rationality is still in beta. While we have this brand-new associative forebrain that allows us grasp conceptual information and model potential futures, our emotions are still geared towards day-to-day survival within the context of a small family-band or tribe.
And those emotions are the weight of our thoughts as we balance competing models of the future against one another.
In the chaotic world of our ancestors, the future was so unpredictable that they never needed an emotive array geared toward planning beyond the next season's hunting and gathering necessities. When food was uncertain and we lacked preservation technologies, a mentality of getting it while the getting was good was a sound survival strategy, and this left us with an emotional bias towards on short-term gratification. Similarly, living in a world of food scarcity, many of our progenitors never acquired an innate inhibition for their appetites.
Related to this is our lack of an emotional handle on large numbers. Above one hundred, our intuitive understanding quickly breaks down.